Integral Diagnostics Ltd · ASX:IDX
Integral Diagnostics — Shareholder Meeting (November 2017)
16 slides from Integral Diagnostics's shareholder meeting presentation, Nov 22, 2017
Slide 1: CEO Presentation at AGM
T | +61 3 5339 0704 E | info@integraldiagnostics.com.au Level 8, 14-20 Blackwood St North Melbourne Vic 3051 www.integraldiagnostics.com.au CEO PRESENTATION AT AGM Please find attached a copy of a presentation at today’s Annual General Meeting including the Outlook on page 15. Yours faithfully INTEG
Slide 2: 2017 AGM
2017 AGM Ian Kadish (MD & CEO) 22 November 20
Slide 3: Integral Diagnostics is a leading Diagnostic Imaging business in Victoria, Queensland and Western Australia
Integral Diagnostics is a leading Diagnostic Imaging business in Victoria, Queensland and Western Australia • Long history in each respective market Ownership 14% • Network includes mix of hospital & community sites 51% – higher complexity and higher margin work 35% – partners include SJOG, Ramsay &
Slide 4: IDX is the clear leader in its regional markets
IDX is the clear leader in its regional markets Brand 24 (incl. 6 9 (incl. 4 13 (incl. 2 hospital hospital hospital sites) sites) sites) 9 11 IDX market 5 3 6 position 2 IDX Competitor Competitor IDX Competitor Competitor IDX Competitor Competitor 1 2 1 2 1 2 • Ballarat: 4 sites • Gold Coast: 11 sit
Slide 5: FY18 focus on rebuilding margins
FY18 focus on rebuilding margins • Reducing labour costs by flexing staff closer to patient demand – Schedule and roster management – Daily revenue and cost information reviewed and actioned • Utilising technology – Voice recognition – Tele-radiology – Automated Worksheets • Increasing capacity util
Slide 6: The industry has attractive long-term fundamentals
The industry has attractive long-term fundamentals • Industry growth supported: An aging population Increasing prevalence of chronic disease Advancements in DI technology for early diagnosis, screening and treatment Estimated revenue in IDX's addressable diagnostic imaging market ($ billions)
Slide 7: MRI and CT utilisation should increase significantly
MRI and CT utilisation should increase significantly Australia’s utilisation rate per thousand population for CT, and especially for MRI, is significantly lower than the rest of the OECD
Slide 8: FY17 – operational achievements
FY17 – operational achievements • Acquired Western District Radiology and South West MRI • Expanded capacity in Toowoomba, Sunbury and Geelong • Executed five, 5-year contracts with West Australian Country Health • Purchased a Mobile MRI (subsequently sold) to service regional WA • Installed new MRI
Slide 9: FY18 – our pace has not slowed
FY18 – our pace has not slowed • Integrated Western District Radiology and South West MRI to be earnings enhancing in FY18 • Expanded tele-radiology services using Australian accredited radiologists based overseas to assist in providing 24/7 coverage at 48 WA hospitals • Opened a new practice, a Spi
Slide 10: Industry now cycling towards higher growth
Industry now cycling towards higher growth • Slower industry growth through FY16-17 Industry growth recovering - Media coverage claiming 14% unnecessary testing 12monthrollinggrowthratebyservices Average5.7% 12monthrollinggrowthratebybenefits Average7.5% 12% - Government announcements to cut health
Slide 11: Regulatory environment more supportive
Regulatory environment more supportive • Reintroduction of MBS indexation for selected DI services from July 2020 • Government proposed reductions in bulk billing incentive for diagnostic imaging scrapped • MBS review is ongoing and direct changes made so far have had a negligible impact on revenue
Slide 12: Improving margins by flexing staff closer to demand and increasing capacity utilisation
Improving margins by flexing staff closer to demand and increasing capacity utilisation • Labour costs as a percentage of revenue have declined by 2% (YTD FY18 vs YTD FY17) –Growing revenue but stabilised FTE equivalents –Employing management information systems and telemedicine to ensure that all s
Slide 13: Investing in Diagnostic Specialty Centres of Excellence
Investing in Diagnostic Specialty Centres of Excellence – Reflects specialisation amongst other medical professionals – Rapidly changing technologies for diagnosis & treatment – Consistent with international trends – Opportunities for radiologists to develop subspecialist skills • South Coast Radiol
Slide 14: Actively exploring acquisitions
Actively exploring acquisitions • Currently evaluating and negotiating opportunities –strong pipeline –price expectations challenging for large groups, more reasonable for standalone and smaller practices –acquisitions to be earnings enhancing & sustainable • Western District Radiology, acquired in
Slide 15: We're doing what we said we'd do in FY18
We’re doing what we said we’d do in FY18 Strategy 1 Grow existing business and contain costs 2 Strategic acquisitions Increase Develop Select Bolt- Drivers of Flex staff to capacity Centres of on Disciplined execution strategy demand utilisation Excellence Acquisitions Geographic Existing territory
Slide 16: Outlook
Outlook • Initiatives outlined are reflected in October YTD financial performance, providing optimism that high single digit growth in FY18 NPAT (before any transaction costs) will be achieved • This compares to previous expectations indicated in August for NPAT to be moderately higher than FY17 15
Integral Diagnostics — Shareholder Meeting (November 2017) on 6ix